Move Could Cut the Company's Capital Costs by Billions of Dollars

AT&T Inc. is planning to rebuild its sprawling network with less expensive, off-the-shelf equipment controlled by software, a move that could cut its capital costs by billions of dollars and put further pressure on telecom gear makers.

The shift will mean the second-largest U.S. carrier will buy less specialized equipment from vendors such as Ericsson, Alcatel-Lucent SA and Cisco Systems Inc., and instead purchase more generic hardware from a wider variety of producers. That equipment will be tied together with...